Katz v. Equinox Holdings, Inc.

Background

Monique Katz and Yekaterina Skidanenko sued Equinox Holdings, Inc. They alleged that Equinox failed to pay minimum wages, overtime, and other compensation required by the Fair Labor Standards Act (FLSA), New York law, and New York City law. Katz also alleged interference with her rights and retaliation under the Family and Medical Leave Act (FMLA). Equinox initially challenged claims brought by both plaintiffs, but withdrew the portions of its motion concerning Skidanenko’s claims.

Katz moved for conditional certification of an FLSA collective consisting of people employed by Equinox in New York State as High-Tier Trainers since May 13, 2018, who were paid a flat rate for personal-training sessions and worked more than 40 hours in a workweek without overtime compensation. Conditional certification is an initial step that allows potentially similar employees to receive notice and decide whether to join the case; it does not decide whether Equinox actually violated the law.

Motion to Dismiss

The court denied Equinox’s motion to dismiss. On Katz’s FLSA overtime claim, the court held that she alleged enough detail to proceed. She alleged that, during specified periods, she worked more than 40 hours in particular weeks without receiving overtime pay, including approximately 45.5 hours in one week and 50.5 hours in another. The court also explained that approximations were not fatal at the pleading stage and that employer knowledge of the overtime work was not a pleading requirement under the FLSA. The court rejected Katz’s argument that an earlier proceeding involving Skidanenko automatically prevented review of Katz’s claim because the two plaintiffs worked at different tiers and alleged different workweeks and unpaid activities.

The court also held that Katz stated FMLA interference and retaliation claims. For interference, Katz alleged that her December 2019 leave was denied under the FMLA even though it was approved under New York law, that she received a written warning for allegedly taking unapproved leave, and that the warning was not withdrawn. She also alleged that a later FMLA-approved leave period was retroactively disapproved and that she was terminated one day before that leave ended. The court found these allegations sufficient to allege denial of FMLA benefits and actual harm.

For retaliation, Katz alleged that Equinox cited her leave and the warning as reasons for terminating her. The court held that the alleged statements by her manager and the timing between her leave and termination adequately alleged a connection between her protected FMLA activity and the termination. The court stated that Equinox could dispute what happened at a later stage, but that those factual disputes could not be resolved on a motion to dismiss.

Because the FLSA and FMLA claims survived, the court did not address Equinox’s request to decline supplemental jurisdiction over related state and city wage claims. The court found it appropriate to exercise supplemental jurisdiction over Katz’s New York Labor Law section 191(1)(a) pay-frequency claim, concluding that the claim did not present a novel or complex state-law question.

Conditional Certification

The court granted Katz’s motion for conditional certification. At this initial notice stage, Katz needed to make a modest factual showing that she and potential participants were similarly situated and subject to a common policy or plan that allegedly violated wage law. The court found that Katz’s evidence—including declarations from Katz and six opt-in plaintiffs—supported the conclusion that Equinox’s written compensation policy applied uniformly to High-Tier Trainers.

The court rejected Equinox’s request to limit notice to particular locations or to trainers who had recorded more than 35 hours per week. Because Equinox applied a uniform pay policy to its New York employees, the court approved statewide notice to the proposed group. The court generally approved notice by mail, email, and website, approved a 60-day notice period, and granted Katz’s request to send reminder notices. The court denied Equinox’s request for limited discovery about whether other High-Tier Trainers were similarly situated, finding that the request was not adequately supported.

The court ordered Equinox to provide, by May 13, 2022, a computer-readable file containing the names, last known mailing addresses, alternate addresses, known email addresses, telephone numbers, and employment dates for all proposed collective members employed since May 13, 2018. The court declined to toll the statute of limitations for potential collective members as a group, without prejudice to individual requests for tolling. The court also denied Equinox’s request to require the parties to meet and confer about the notice.

Disposition

The court denied Defendant’s motion to dismiss and granted Plaintiff Katz’s motion for conditional certification of a collective. Judge Valerie Caproni directed the Clerk of Court to close the two open motions.